Social Networks

In Airtime Video Chat Reboot, Nudists Need Not Apply

In 2009 a Russian teenager named Andrey Ternovskiy introduced an online video service called Chatroulette, which allowed perfect strangers to meet face to face over the Web. Its cleverest feature was the “next” button—a way for users to dump their conversational partner and connect with a different, random person somewhere else around the world. For many users it became an enthralling way to crisscross the globe in search of someone interesting, attractive, or perhaps just wearing a gorilla costume. The site went viral, drawing about 1.6 million monthly users in early 2010 before ultimately fading in the face of what can only be called the “penis problem”: the impulse of otherwise rational men to celebrate a webcam chat by exposing themselves.

Shawn Fanning, the creator of Napster, was immediately entranced by the service. “For the first time, you could actually surf people,” he says. Fanning decided to team up with his Napster co-founder, Sean Parker, who’s better known as the billionaire former Facebook (FB) president. Their startup, Airtime, is the result of almost two years of work. It made its debut in a New York City event on June 4 that was as star-filled (Jim Carrey and Julia Louis-Dreyfus made appearances) as it was glitch-ridden.

Photograph by Gail Albert Halaban/CorbisFanning and Parker in the Napster days

The venture has what passes in Silicon Valley for a sterling pedigree. First, there’s the Sean/Shawn team-up, like two classic rockers reuniting for a world tour. And the startup has raised $33 million from A-list investors including Kleiner Perkins Caufield & Byers, Andreessen Horowitz, Accel Partners, and Google Ventures, to name a few. (Bloomberg LP, which owns Bloomberg Businessweek, is an investor in Andreessen Horowitz.)

The full story behind Airtime could be fodder for The Social Network 2. When Ternovskiy’s Chatroulette became an international sensation in early 2010, the Muscovite moved to Palo Alto to turn his cultural hit into a business one. Fanning had just left the social network Path and took the time to help mentor Ternovskiy; Parker offered backing and financial advice as well. Venture capital firms, including Accel, considered investing. But the young, headstrong Ternovskiy was insistent that users of Chatroulette remain anonymous, and the service was overrun with obscene content as the Web’s attention drifted elsewhere. (Ternovskiy did not respond to multiple requests for comment.)

Fanning and Parker decided to chart their own course. They believe they’ve created a video chat service that takes what was compelling about Chatroulette and makes it safe, fun, and potentially profitable. “Chatroulette pushed the boundaries, and a lot of people missed that or didn’t care because they just saw the negative outcomes,” says Parker. Adds Fanning: “A lot of people just couldn’t look past the c- -ks.”

Airtime avoids the pitfalls that snared Chatroulette primarily because it hooks into Facebook, say the founders. Users sign in with their Facebook user name and password. The site then imports their photo, identifying information such as hometown and job, and all the things they’ve said they “like” on the social network—NBA basketball, for example, or John Irving.

Users can then talk to their Facebook friends, search for someone with similar interests, or just hit the “next” button to find a random chat partner, a feature essentially copied from Chatroulette. As two users converse, Airtime suggests interests and friends they may have in common in an effort to spark conversation. Airtime also hooks into YouTube (GOOG) so users can watch and discuss videos together.

The site’s creators argue that they’ve solved the problem of male exhibitionism by linking a person’s chat identity with the identity they’ve cultivated on Facebook. Airtime always knows who its users are and will ban them or even report them to authorities if they are flagged for obscene behavior. (To protect privacy, Airtime hides names and identifying information when strangers chat.) “One of the great things about Facebook is that it gives you accountability,” says Parker.

The company has also spent much of the last year at its San Francisco headquarters building safety mechanisms, such as visual-recognition software that can spot errant activity. Algorithms measure variables such as the length of a user’s typical conversation, then ranks that user’s suitability to be introduced to someone. Airtime also employs contractors who manually review screen shots from conversations where abuse was reported.

Parker, the chief executive officer, says he’s focused on building a large user base. Airtime is ad-free for now, but will eventually make money primarily by showing full-screen video ads, which sell for high rates. The company is also developing a way for users to buy virtual goods and add them to their profiles or give them to chat partners. Considering the sky-high amount already invested in Airtime, all that should be coming in the near future. If, that is, everyone can keep their pants zipped.

The bottom line: Napster co-founders have raised $33 million for a video chat service that uses Facebook and algorithms to keep perverts out.

Stone is a senior writer for Bloomberg Businessweek in San Francisco. He is the author of The Everything Store: Jeff Bezos and the Age of Amazon (Little, Brown; October 2013). Follow him on Twitter @BradStone.